Parliament - Public Enterprises Minister Malusi Gigaba on Tuesday unveiled a 12-year turnaround strategy for troubled South African Airways, focused on consolidating its routes and updating its fleet.
The long-awaited strategy was aimed at bringing the national carrier back to a point where it could leverage off its balance sheet, Gigaba told Parliament's portfolio committee on public enterprises.
“The focus on domestic and regional African routes will have a direct financial impact on SAA,” he said.
“It will be able to leverage off its balance sheet without the stringent conditions imposed by lenders due to a weak financial position.”
The plan would be implemented in a “speedy and unyielding manner”, the minister added, stressing that “failure is not an option”.
Increased efficiency, fleet renewal, and cost savings were pillars of the plan, as well as an envisaged brief to all government departments to exclusively use SAA for work travel.
He said the latter would be modelled on the United States' Fly America Act but added that it would be “fruitless if (SAA) had a bad public service record”.
New chief executive Monwabisi Kalawe hailed the blueprint as the most comprehensive in the airline's history.
SAA reported a loss of R1.25 billion last year.
Kalawe acknowledged that turning it around would be a big challenge given the “headwinds out there” of strong competition, high fuel costs, and a weak currency. - Sapa